Previous CEL Events
- Launch Event - Risk & Regulation: Regulation and the social meaning of risk
- Ethical performance of business – achievements, aspirations and expectations
- Business reputation - ethics in the downturn
- Expertise in Ethics & Risk Regulation
- Inaugural AstraZeneca Think Tank Debate
- The Governance of Autonomous Systems
- Second Annual Lecture: The Moral Limits of Markets
- Perception and Reality: The Compensation Culture
- Performance vs. Compliance: A Global Leader's Guide to Managing Business Conduct
- Tweeting to Topple Tyranny: Social Media, corporate Social Responsibility & Human Rights
- Shareholder Engagement in the Embedded Business Corporation: Investment Activism, Human Rights and TWAIL Discourse
- Conflicts of Interest: A mere governance challenge or a moral maze?
- Humans vs. Robots: Where are the limits of what an autonomous system should do?
- CEL Annual Lecture 2012: Media Freedoms & Media Standards
- Between Law and Markets: Is there a Role for Ethics and Culture in Financial Regulation?
- Handling Problem Projects - Accountability mechanisms at international financial institutions and case studies
- Lehman Brothers and the Lawyers: (When) Are Lawyers Ethically Responsible for Client Wrongs?
- Workshop on the Financial Sustainability of Banks
- Think Tank with Andrew Bailey
- Experiencing and Teaching Ethical Problems
- CEL Think Tank with the Legal Ombudsman
- Debate with Lexis-Nexis - Legal Innovation: How should the Educators respond?
- Business and Human Rights - Student Seminar
Workshop on the Financial Sustainability of Banks
Publication date: Oct 8, 2012 12:02:00 PM
Feb 6, 2013 6:00:00 PM
End: Feb 6, 2013 7:30:00 PM
Location: UCL Faculty of Laws, Bentham House, Endsleigh Gardens, WC1H 0EG
Speaker: Professor Roger McCormick (London School of Economics)
Chair: Professor Emilios Avgouleas (University of Edinburgh)
About this event: A league table of Bad Banks might lead to improvements in the ethics of Banking, argued LSE’s Professor Roger McCormick at a UCL’s Centre for Ethics and Law event on Sustainable Banking. He drew on evidence to the Banking Standards Committee criticising the idea that what Banks needed were more lawyers and compliance staff. Doubting the efficacy of Codes of Conduct, he advocated a focus on steps that might genuinely influence banking conduct. If it is the case that codes and process measures can simply be worked round and recognising that basic values may be important it was necessary to find other techniques. Structures played a role: Professor McCormick pointed to the de-federalisation of Barclay as a positive sign that the Bank might be taking control of the compliance and ethics problems it faced, with reporting lines direct into the CEO.
But there was a profound need to realign the interests of boards who had often not been informed of illegalities and other problems in their Companies. One approach was to look for proxy indicators of poor culture and magnify attention on those. Interestingly, Banks Sustainability Reports do not, he emphasised, contain information on regulatory findings and fines in spite of guidance that they ought to. McCormick has been developing a tabular format for collating and simplifying the information into a league table to make the information more impactful. The information is collated by researchers including fines and the nature of any breach.
Professor Emilios Avgouleas of the University of Edinburgh applauded the initiative and warned against too superficial a reliance on the notion of cultural change. To understand what we meant by a sustainable bank we had to think about what the purposes of a bank were and how those purposes could best be served. Complexity and incentives meant that utility banking, hedging and speculation had merged into a melange of one purpose where gambling and outsmarting competitors had become more important than long term financial health. For Avgouleas incentives were the key; at the moment they encouraged manipulation and short termism. Steps like McCormick’s league table had potential, he thought but regulators needed to concentrate on incentives not culture. In particular, a naming and shaming approach would not prevent a serious financial sustainability event in the future.
With the seminar taking place on the day the Francis Report was published, a member of the audience posed the broader question: isn’t cultural failure a broader social phenomenon? And if so, where does that failure stem from? The audience member felt that was a failure of societal values. An interesting area of deliberation which the Centre is involved in encouraging dialogue, is what role if any law and regulation has to play in shaping such values.
Page last modified on 15 jan 13 11:41